Union Bank v. Call

BALTZELL, C.. J., delivered the opinion of the Court. On the 25th day of February, 1842,- the Union Bank recovered judgment against Richard K. Call for the sum of $4080 40, on which an execution issued the 29th day of February, 1851. On the day of , Call filed bis audita querela, claiming that the judgment was released and the execution discharged, and praying that it might be so declared.- The Bank disclaimed any interest in the judgment and execution, having, as they stated, assigned the same to Charles Morrison. He files his answer and states that on the, 22d February, 1843,. tbe Bank, for a full and ample consideration, actually paid, assigned to him tbe said judgment, with other claims so that the controversy is in fact between Call on tbe one- side, claiming under bis release,, and Morrison under his assignment, and it has been so-treated on both sides. The case yas tried by a jury, who found for the plaiaxtiffj, — 423 — Call. On the trial, Morrison excepted to various rulings of the Court, which are now presented for consideration. His assignment of errors embraces the instructions given to the jury, but we are of opinion that these are not properly before tbe Court, and cannot be considered. Although copied into the record, they form no part of it, as they were not excepted to at the trial, nor embodied or referred to in tbe bill of exceptions. It is perhaps not very material in this case, as the instructions refused and the other rulings properly objected to, present the material questions in the case. Morrison offered in evidence a deed of assignment from the Bank to him, signed by the President, and under the corporate seal, which the Court rejected, because there was no proof that it was authorized by the Board of Direct, ors, hut afterwards permitted it, on the representation of the defendant that he expected to show that the deed was executed by authority, and that the Board -ratified it subsequent to its execution •, the Court saying it might be read,' subject to its charge as to the legal effect. This is complained of as erroneous. It is difficult to perceive the injurious effect this ruling had during the progress of the trial, as no further notice was taken of it. No instruction of the Court was given in reference to it, and defendant seems to have had the benefit of his assignment before the Jury. There is no question, we think, that the deed should have been admitted, without qualification, as conveying the right of the ~Bmkprima faeie, throwing upon the adverse party the burthen of showing that the seal was fixed improperly — surreptitiously as some of the authorities say j through fraud and without authority, according to others. Angel & Ames, 194; 6 Paige, 56, 60. Morrison then offered in evidence certain entries in tbe book of accounts of the Bank, admitted to he kept by the — 424 — Cashier and other officers of the Bank, which the Court rejected, and this is assigned for error. We think the Court decided correctly. Whatever weight these may have as against the Bank or its members, they are no evidence of right against strangers; it was not a public but a private entry. Angel & Ames, 606-’7.; Archd. Pl. and Ev., 415; 1 Greenl., 415. Nor do we we think the Court erred in rejecting the questions proposed to George K. Walker that were objected to. The contract was for the construction of the Court, and not of a witness, however intelligent; nor was it proper to ask his designs in its execution. The object of reducing the deed to writing, was to prevent a reference to parol testimony, so that the instrument should speak for itself, according to the fair construction of its terms. The counsel for Morrison then proposed certain instructions to the jury, which were refused, which we now propose to consider. The first instruction is for want of consideration on the part of Call, in the part of the contract embracing this judgment, and the want of authority of the Board of Directors to release debts without consideration. The instrument is under seal, and this imports consideration. “ If a creditor signs a release to his debtor, this is sufficient.” Bull. N. P., 153; Forsyth Comp. Cred., 17. “A creditor cannot preclude himself, by simple agreement (not under seal,) to take less than the whole amount of his debt, from suing the whole of his demand. But if a man acknowledge himself to be satisfied by deed, it is a good bar, without anything received.” Pinnel’s Case, 5 Coke, 117; Forsyth, 17. In this case, Call paid $88,200 for his own debt, and secured $10,000 for the debts of Reid and West. Now what is to prevent this from operating as a consideration for the — 425 — whole ? There is no evidence that he was able to pay more, or that more could have been made by the rejection of this arrangement, and a course of greater severity and exaction. It may have been to the interest of the bank to accept this much, even if it were one third or one half only of the indebtedness, in preference to a resort to legal proceedings. We take it for granted the Board of Directors were acquainted with the facts, and competent to judge of the propriety of the act, and as they do not complain, and have not alleged any exception, that there is in truth no valid cause of objection. We do not think there was error, then, in refusing this instruction. The second instruction is predicated upon the difference between the resolution, or rather the report of the Committee to the Board of Directors, and the deed of the President, the latter providing security for payment of the debts of Keid and West, whilst the former directs their actual4payment. There is no proof of non-payment of these, nor of dissatisfaction by the Bank on their account. It is supposed, and the instruction is based on the ground, that the deed of the President is void, because it does not pursue the order of the Board. We do not think so. It is not every deviation that makes such a deed void. It might have justified the Directors, perhaps, in rejecting or refusing to ex-execute and declaring it a nullity. But it is their option to do so, or they may act upon and adopt the contract in its new shape. The presumption from receipt of the $88,-000 from Call, and the release of the Bank as to the $10,-000, is that it was not disagreeable to them, and they ratified it. Certainly after the lapse of near ten years, this would be the case. The Bank could only disaffirm the contract by dissent in a reasonable time, and returning the amount received. But there is a very decisive answer to a declaration of the Court that the deed is “not binding” — 426 — at the instance of Morrison. It is not for Mm to set np the invalidity. The Bank is the party to make complaint, and if she waives or surrenders her rights, it is not for others to assert them. Whilst satisfied with the view thus taken, it may be appropriate to refer to authorities on the subject. In Burnett vs. Nab ant, the Directors “ authorized two of their Board to sell and transfer any estate or property of the Bank,” and they mortgaged the Banking House, which was objected to as unauthorized. The proof was that there was no vote of the Board, and the witness, an officer of the Bank, understood from the Directors individually that they were to make the mortgage; that they received from the party a bond not to put in circulation a certain sum in bills of the Bank, and that the Cashier paid costs of suit -as part of the adjustment, but that the bills were not given up. The Court say that “this shows a ratification, without enquiry whether the act pursued the authority.” 2 Met., 167. Clarke vs. Imperial Gas Light Company, was the case of contestation of a corporate seal, on the ground of want of authority, and other irregularity. The Court, Denman C. J., say : “ It is enough, however, to observe that proof of this in-egularity does not, appear in plain terms upon the case, and the Company, seeking to set aside its own formal act, on the ground of irregularity in the preliminary proceedings, ought to make out such a defence by the most cogent proof. If this (alluding to same act,) were, regularly-done, before affixing the seal to the instrument, all would be right, and inasmuch as’the seal was set by those who had the power of affixing it to an instrument, to give effect to a bargain which the Company had power to make, and as no fraud, is found in the ease to attach to the plaintiff, and there is a £possibility,’ upon the facts set forth, that the apparent ix-regularity may not have occurred, we think — 427 — the plaintiff is entitled to judgment.” 1 Neville & Mann, 218. In Lovett vs. Steam Mill Company, the Court held the mortgages executed by the President, who had the legal custody of the seal, were prima faeie evidence that the whole amount secured thereby was justly due, and it lay on the defendant to establish the fact by legal proof that there was fraud in obtaining it, or that the seal was improperly placed on the bonds and mortgages, without authority. 6 Paige, 61. These are cases between the party and a corporation. The third instruction is too indefinite. Admitting that the deed executed was not authorized by the resolution, and that the construction of the words “ now belonging to the Bank,” was as contended for, what follows? Were the jury to find for defendant, or to infer that on this account it was void, or passed no interest ? If given, it might have misled the jury, without enlightening them. Even if asked in the manner supposed, we do not think, for the reasons already assigned, the instruction should have been given. The sixth instruction relates to notice by Call of the assignment of Morrison, and is predicated on the evidence in the record to that point. Gr. K. Walker deposes that “he was general agent of Call, and transacted all kinds of business for him, and produces a power of attorney to that effect, authorizing him to purchase and sell for him all kinds of property, real and personal, and to sign his name to any note, bond, draft, deed, or any other instrument, and to bind him thereby in as ful^and ample a manner as he could, if he were present.” HeyWalker, was party with Call in the deed with the Bank, and equally bound with him in its covenants ; was — 428 — defendant in the execution and judgment obtained on the notes of Bartlett, and alike interested to procure its release ; was joint mortgagor of the property mortgaged to the Bank which was assigned to Huth & Co.; was joint promisor and endorser on other notes enumerated in the deed of the Bank, which were transferred to Huth & Co. He says “ that he acted for himself and as agent for Call in the negotiation, and communicated with him in reference thereto, and advised and consulted with him as to the terms of the negotiation ; that Oall tooh no active pa/rt in making the arrangement, but adopted and consented to the terms of the deed when finally settled, and signed it without objection. He says further, that he, Walker, prepared the deed himself.” It appears further that Walker’s name was signed, with that of G-amble, to the réport made to the Bank of a Committee appointed to adjust the terms of the settlement. He also proves that prior to the time at which the negotiation commenced, he, Walker, received notice from Mercty, attorney of Morrison, of the assignment of the judgment on the Bartlett notes, and produces the notice", but does not know that he made the fact known to Call. Under such a state of facts, would a jury have been justified in finding, as prayed by the instruction, that Call had knowledge of the assignment 2 We think very clearly they would. “ The general rule is that notice to an agent is notice to the principal himself.” Story on Agency, 182. It has been argued that Oall was on the spot, and was able to and did in fact attend to the business himself, by signing the deed, and on that account is not subject to the operation of the rules applicable to agencies. We do not think so. It may be a question, indeed, whether he is not held more strictly liable for failing to use the diligence a prudent man should exert in the conduct of his — 429 — affairs. If attending personally to the negotiation, he could npt have failed to inform himself of the assignment of this judgment equally with Walker, who conducted the negotiation. The principles of law are too well settled to admit of a doubt even on the subject. The leading case is that of Le Neve vs. Le Neve, decided by Lord Ilardwicke, after very mature consideration. In this case, the party was held liable to notice on account of information possessed by hex* solicitor, although there ivas no proof of knowledge on her part; and he notices the decision of a previous case of a contract made by an agent who was cognizant of a previous settlement, and his principal was held liable, although there was no proof of any communication to him of the fact. 3 Atkins, 646. Again, Walker j,was co-obligor with Call as to the covenants in this deed, and notice to him is sufficient. White & Tudor Case Eq., 214; 2 C. &. M, 231; 2 Keen, 35. It is a material fact that the report of the Committee of the Board of Directors, appointed to negotiate the terms of settlement, agreeing in other respects with the deed made by the President, has the words, “ Notes endorsed by said Call and Walker now "belonging to said BmiJe, described in the said mortgages.” They are omitted in the deed. This report is adduced by the plaintiff, Call, himself, in its support, and it is contended that these words are without force or meaning, and would not have varied the deed, if introduced into it. We do no think so. The effect of the omission is not before us. We are clear in the opinion, however, that it is important as far as the question of notice is concerned. It is signed by Walker, and may be regarded as additional notice in the course of a transaction in which he was acting on behalf of his principal* The fair presumption is that it was communicated to — 430 — Call, as tbe omission to do so would hardly comport with the duty of the agent or the natural desire of the principal to inform himself of the terms on which the Bank was willing to contract. We are of opinion, then, that the Sth/'insttuction should have been given to the jury, and that the Court erred in rejecting it. The question of preference of a subsequent purchaser, or release without notice, over a prior assignee of a judgment and execution, has been argued before us with masterly ability, but as the question is one of great difficulty, and there is a painful conflict of authority about it, we have thought it most prudent to defer its consideration and decision to a more appropriate occasion, especially as this case may he decided in the Court below without it. It is therefore considered by tbe Court that tbe judgment of tbe Court below be reversed and set aside, and tbe cause remanded, with instructions to the Court below to give tbe sixth instruction, as asked by tbe defendant, and for further proceedings, not inconsistent with this opinion.